Consumers looking for fast cash have come to realize that payday loans have become a very popular source of lending. These loans are short-term, meant to be used for temporary financial use, and unsecured (meaning there is no collateral required in order to get a loan). More than $10 billion is borrowed every year via direct payday advance lenders online and in-store. With thousands of lenders out there, consumers are not at a loss when it comes to borrowing options. If you are considering borrowing with a temporary small-dollar loan such as these but don’t know how the process works, take a few minutes to read about some of the most frequently asked questions and answers in an effort to educate and inform yourself before you set out to get a payday advance.
What should should know the difference between indirect and direct payday advance lenders? Direct lenders must be licensed to loan in the state you live and meet the state’s lending requirements. They will process, fund, and service your loan until it’s paid off. Indirect lenders, on the other hand, are not actual lenders but are a “middle man” to getting a loan with a direct lender. They are paid a commission to find you a lender once you have submitted your application. They won’t fund your loan nor will you deal with them during your loan repayment term. How can you tell? A direct lender will have their licensing information on their wall or website whereas an indirect lender should provide a disclaimer stating they are not a direct lender.
What is the process of getting approved? Most lenders make it very easy too apply via a quick application over the Internet or in-store. While lenders typically have liberal approval requirements, not everyone will be approved. In most cases, all that an applicant needs is: a verifiable income that meets the minimum income requirement, a checking account with direct deposit, and a willingness to repay on their next payday.
Can I still get a payday advance loan if I have filed bankruptcy? Not all lenders are the same in their lending guidelines but most are not concerned with whether or not an applicant has filed for bankruptcy in the past. Most lenders don’t even run a person’s credit history. Provided the applicant is not in a bankruptcy at the time they apply for a loan, they don’t have to worry. One of the biggest advantages of getting these types of short-term loans is that bad credit, spotty credit or not credit at all really doesn’t make a difference in the approval process.
Are payday loans as expensive as people say they are? Compared to paying overdraft fees, late charges, and credit card over-the-limit penalties, payday advances may be the more economical way to go when needing cash. Most direct lenders charge a flat fee per every $100 borrowed as well as assessing a fee if the loan is not paid off within the agreed upon time frame (usually the borrower’s next paycheck). Before you apply for a loan, shop lenders to find the best rates.
What is the difference between a payday loan online or in-store? In the past, payday lenders were found mainly in retail locations. With the Internet, though, consumers have dozens of lending options. Thousands of lenders offer online applications that make it possible for someone to apply for and be approved and funded without ever leaving their house. It’s all about personal preference when it comes to deciding how one wants to go about getting a fast cash loan.